Category: Taxes

“Holtz-Eakin points out that this unconventional tax structure will dramatically skew the health care market in favor of non-profit providers. Insurers subject to the free will have to make up for the expense it imposes on their business somehow, either by cutting their costs or by raising their premiums. Those not subject to the fee will obviously not face this dilemma, and hence they won’t face any financial pressure to raise their premiums. However, the for-profit insurers subject to the fee will suffer the most, as their losses will be compounded by the fee’s non-deductibility. Holtz-Eakin calculates that for-profit insurers subject to the tax will have to raise their premiums by $1.54 for every $1 imposed on them by the fee just to break even.”

“An annual fee to raise money for President Obama’s healthcare law will increase insurance premiums by billions of dollars on the whole, according to a new report by a conservative think tank. The American Action Forum, led by former Congressional Budget Office Director Douglas Holtz-Eakin, argued that the annual fee from insurers starting in 2014 amounts to a tax on the middle class.”

“The House passed legislation Thursday that would repeal the healthcare reform law’s tax on medical device manufacturers. The measure won the support of 37 Democrats despite a veto threat from the Obama administration. The bill was approved 270-146 after a debate in which Republicans said members of both parties support repeal of the 2.3 percent tax, which was created by the 2010 healthcare law.”

“The House voted Thursday to advance legislation that would repeal the 2.3 percent medical device excise tax imposed by the Democratic healthcare law in 2010, which would raise an anticipated $29 billion over the next decade. Members approved the rule for the legislation, H.R. 436, in a mostly partisan 241-173 vote, although eight Democrats joined Republicans in support of the rule.”

“Reviewing peer-reviewed literature on the relationship between medical technology and improvements in life expectancies, Zycher estimates that the knock-on effect of the tax will be about one million life-years lost annually. (Due to limitations in applying the literature, it not possible to tell the degree to which this tilts towards one million people dying one year earlier, or a smaller number of people dying many years earlier. My own interpretation leans towards the latter.)”

“To develop a more conservative projection of the likely reduction in employment, we estimated the relationship
between revenue and employment in the industry. Through our analysis, we found that an average of 1.274 direct
industry jobs and 2.210 indirect jobs are lost per year for each $1 million reduction in industry revenue that year.”

“Top administration officials cut backroom deals with the nation’s top drug companies to win support for President Obama’s health care overhaul, threatening them with steeper taxes if they resisted and promising a better financial deal for the industry if they acquiesced, according to internal documents released Thursday by House Republicans. In some of the key deals, Mr. Obama agreed to drop his long-standing support for letting Americans buy cheaper foreign prescription drugs — something the pharmaceutical industry vehemently opposed — and the drugmakers promised to mount a public campaign to sell the public on the health care legislation.”

“Makers of medical devices are gaining some momentum in a vigorous campaign to persuade Congress to scrap a tax imposed on their industry by the 2010 health-care law. A bill to void the tax sponsored by Rep. Erik Paulsen (R-Minn.) will be marked up in the House Ways and Means Committee Thursday. Republican House leaders say a floor vote could be scheduled as soon as next week.”

“As part of writing ObamaCare, they decided that all “stakeholders” should contribute something, but changes to the ordinary corporate tax code wouldn’t raise enough money and would have hit many other innocent bystanders in manufacturing. So they chose an excise tax. About the only exemptions are for things that retail consumers buy directly, such as contact lenses or hearing aids.”

“Many small businesses struggle to afford health insurance for their workers, but a a new tax credit meant to help them seems to be turning into a disappointment. Although opinion polls show the credit is one of the most popular ideas in President Barack Obama’s health care law, only 170,300 businesses out of a pool of as many as 4 million potentially eligible claimed it in 2010, about 4 percent.”